emergency manager

this one

In Michigan, everybody’s well-being depends to some extent on Detroit not collapsing into economic chaos. It doesn’t matter what you think of the city. The healthier Detroit is, the more easy it becomes to attract business, jobs and people to the state.

So if you realize that, yesterday seemed like a pretty dismal day as city and state officials struggled to try and avoid an emergency manager.  Last week, Governor Rick Snyder presented a proposed consent agreement to the city which was met by furious hostility.

YPSILANTI, Mich. (AP) — Leaders of the Willow Run and Ypsilanti school districts say plans to consolidate could prevent them from being placed under the control of an emergency financial manager.

AnnArbor.com reports both school districts have been on the state's list of districts operating with a deficit consistently since 2009. Ypsilanti Public Schools has a total projected deficit of $9.4 million and Willow Run Community Schools has a $1.7 million deficit.

The superintendents of both districts said Tuesday that consolidation could prevent an emergency manager and improve student achievement.

Ypsilanti Superintendent Dedrick Martin says his district has spent more than it has taken in since 2004-05. Willow Run Superintendent Laura Lisiscki says school officials are looking to take a local, proactive approach to solving their schools' growing financial and student achievement problems.

A small crowd camped out inside the building that houses state offices in Detroit Friday.

The group was there to protest Michigan’s emergency manager law, Public Act 4—and the state’s plans to use it in Detroit.

The protest was small and peaceful, if loud, with prayers and song. Tempers did flare briefly when private security guards tried to force protesters to leave.

Governor Snyder and other state officials have told Detroit this week it needs to accept a consent agreement to avoid going broke.

A draft agreement has been presented to the City Council. It would give the state a great deal of say in how Detroit is run.

But lots of politics stand in the way of reaching an agreement.

The consent agreement State Treasurer Andy Dillon has crafted for Detroit—the only “official” proposal out there right now--can be seen in one of two ways.

Dave Hogg / Flickr

DETROIT (AP) - Detroit Mayor Dave Bing says he won't accept the position of emergency manager for the city even if it's offered by the state.

The mayor's remarks came Wednesday during a forum at Wayne County Community College District, one day after state officials delivered a proposed consent agreement for the city. The proposal was an ultimatum that would shift political power, consolidate public utilities and shrink city staff and salaries.

Bing says he disagrees with the proposed consent deal and had no input in the consent agreement proposed by Gov. Rick Snyder and Treasurer Andy Dillon.

Detroit is facing cash flow problems and a $197 million budget deficit. A state review team has already been digging into its troubled finances, and the governor could appoint an emergency manager.

City of Detroit Facebook page

LANSING, Mich. (AP) - Gov. Rick Snyder is urging Detroit leaders to accept a consent agreement that would make them accountable to a financial advisory board, even though Mayor Dave Bing and some council members are unhappy with the deal.

Speaking Wednesday in Lansing, the Republican governor says the initial reaction from officials has been "go away."

He says it's a "cultural challenge" to get leaders to accept that the city can't fix its financial woes on its own.

Snyder could appoint an emergency manager, but prefers to reach a consent agreement he says would leave the mayor and council members in charge of policy. City leaders got details of the agreement Tuesday and found lots to criticize.

Bing called Snyder "disingenuous." Snyder says it's unfortunate "to make a personal attack out of this."

Sadly, it appears that the state of Michigan will be taking over the city of Detroit, one way or another. There are a lot of reasons that this is a tragedy, and also a few reasons to be happy about this.

However the next few weeks play out, the city, one way or another, seems likely to get the help it needs to straighten out decades of terribly mismanaged finances. Yesterday, Governor Snyder announced details of a proposed “consent agreement” which would bring radical change and fiscal responsibility to Detroit.

user: Patricia Drury / flickr

Gov. Rick Snyder presented a proposed consent agreement to City of Detroit officials. Snyder wants to use a consent agreement rather than appoint an emergency manager to fix Detroit’s finances.

Stephen Henderson is the Free Press’ editorial page editor and of “American Black Journal.” He spoke with Michigan Radio’s Jennifer White.

“The whole idea of the consent agreement is about control and power, and this agreement would ask the Mayor and City Council to give up a lot of that,” Henderson says.

Update 3:02 p.m.

The state's consent agreement plan was delivered to Detroit city council today. Among other things, it calls for the establishment of a financial advisory board that would oversee actions by city council and the Mayor.

Detroit Mayor Bing does not like the plan, according to Detroit News columnist Nolan Finley.

And here's some reaction from Detroit city council members:

The Detroit News reports:

Earlier Monday, City Council member James Tate voiced this concern: "By no means am I pleased with what I saw." He and others declined to discuss specifics of what they had read.

Council President Pro Tem Gary Brown, a staunch supporter of the need for a consent agreement, said he had some reservations about the executive summary he read.

From a statement from Detroit City council member Virgil Smith:

“It is clear that the Snyder administration is trying to circumvent the legislative process by any and all means.  The Governor’s Emergency Manager Law is undemocratic and this agreement is also undemocratic.”

“The governor knows that there is a good chance the Emergency Manager Law might be overturned, therefore, on line 18 of the executive summary, they specifically state that they are attempting to ‘survive the potential suspension of Act 4.’  Therefore, this agreement is really not a better solution than an emergency manager; it is actually worse.  I urge my colleagues on the Detroit City Council to vote against this plan.”

And the Detroit Free Press reports that some council members have asked their attorneys to review the proposal, "saying a consent agreement is unconstitutional and anti-democratic."

Councilwoman JoAnn Watson went further, saying a consent agreement is like a death sentence to the city because elected officials lose power in the process. "In a consent agreement, you are consenting to your own demise. It's outrageous," Watson said. "Who puts a noose on their own neck?"

11:33 a.m.

Governor Snyder appeared on Detroit's WCHB Radio this morning and talked with Angelo Henderson about the consent agreement the state delivered to city leaders this morning.

Snyder said the agreement calls for the creation of a financial advisory board that would advise and sign off on proposals put forward by the mayor and city council.

"We would create a financial advisory board. Appointments would be made jointly by me, the city council, and the Mayor."

Snyder said those nominated to the board would have the required "turnaround" expertise. The board would be vetted by the Michigan Association of CPAs.

"It's not to run the city, it's to support the city. The mayor and council would still run the city," said Snyder. "There would be this additional review and sign off to make sure it's being done right."

Snyder said Mayor Bing has been working hard to solve the city's problems, but he hasn't had all the resources he's needed.

Snyder highlighted three things that he hopes will come as a result of the consent agreement:

  1. financial stability
  2. better basic services - public safety, bus service, lighting
  3. creating a positive vision for the city of Detroit - "let's build a better city," he said.

When he was asked about privatizing certain departments like the city's lighting department or the transportation department, or the city airport, Snyder said the city should explore ways to "partner with others" to improve city services.

Gov. Snyder said the state has increased revenue sharing with cities in the next fiscal year budget, but said more money is not the answer. "It can be in a situation where we're putting more money in a hole. We need to fix the basics in the city," he said.

The deadline for the city to sign on to the consent agreement is March 28, "I'm concerned about hitting that deadline, that's why I'm happy to talk with you," he told Henderson.

If the agreement isn't reached, the state could appoint an emergency manager to run the city.

As Michigan Radio's Sarah Cwiek reported earlier:

Detroit will go broke in the next couple of months, with a $45-50 million shortfall expected by early summer.

One Detroit City Council member who saw an earlier draft of the consent agreement said he's concerned that too much power will be stripped from council.

From the Detroit News:

"I'm interested to see how it changes," Tate said. "I certainly don't believe there's going to be a vote on it (today). I felt under the gun when I came into office. I felt under the gun in November. I feel under the gun now. But we absolutely do have to get our finances together."

Detroit City Council President Pro Tem Gary Brown expects to the agreement to have a mix of things:

"I'm sure there will be things in the document that I get to see (Tuesday) that I absolutely cannot live with," Brown said. "There will be things that I certainly will be willing to negotiate. And there will probably be quite a bit of it that I certainly agree with 100 percent."

10:46 a.m.

The Associated Press reports the state's consent agreement plan aimed at correcting Detroit's troubled finances has been delivered to city officials this morning. The plan includes privatizing some services.

More from the Associated Press:

Councilman James Tate says the deal includes an advisory committee that would remove some power from elected officials. Tate says the consent agreement reads more like a "one-way edict."

If approved, the deal could keep the state from appointing an emergency financial manager in Detroit, which faces a $197 million budget deficit.

The Detroit City Council, Mayor Dave Bing and a 10-member financial review team were expected to assess the proposal. Council wasn't expected to vote on it Tuesday.

Snyder has said he prefers a consent agreement, which would allow Detroit to fix its own finances.

Governor Snyder today signed off on a consent agreement for the city of Inkster.

The move will help the southeast Michigan city avoid getting an emergency manager.

A team appointed by the governor to review the city of Inkster’s financial condition recommended a consent agreement with the city.  The Inkster city council signed off on the agreement last week.

The governor says the consent agreement will allow the state to “assist Inkster’s elected officials, in moving their city forward and returning it to a solid financial footing.”

Kate Davidson / Changing Gears

Update 3:58 p.m.

Mayor Bing's office issued this statement in response to today's reports:

Mayor Bing has not asked Gov. Snyder for a loan from the state for  $125-$150 million. In response to a reporter’s question about whether he would ask Gov. Snyder for bridge funding for the city, the Mayor simply replied, "That's possible." When the reporter later asked how much he would like to ask for, the Mayor responded with the above mentioned range.

“The city continues to implement the financial restructuring plan the Mayor announced in January to save $102 million this year and $258 million in 2013,” said Kirk Lewis, Mayor Bing's chief of staff. “The savings to keep the city financial solvent will be achieved through the plan, including the ratification of previously announced tentative agreements with the city’s labor unions.”

1:44 p.m.

There’s discussion today about whether Detroit might ask taxpayers to help Michigan’s largest city through a cash crisis.

The city could run out of money in May, or sooner.

Detroit Mayor Dave Bing said he might or might not ask the state for a $150 million bridge loan.

He said earlier this week in his State of the City address that some assistance from Lansing will be necessary to fix Detroit’s finances.

Governor Rick Snyder said he hopes a legally binding plan to get Detroit’s  spending under control will avert a state takeover.

Geralyn Lasher is the governor’s communications director.

“From the governor’s perspective, you have to have it to be a complete plan. Certainly, the dollars at the state level are extremely limited. We need to be very smart and efficient in how the dollars are spent.”

Lasher says a short-term cash infusion is out of the question without a long-term plan to balance the city’s budget.

Republican leaders have reacted skeptically to the idea. A state review team is expected to make its recommendations by the end of the month on whether the governor should name an emergency manager to run the city.

(photo by Steve Carmody/Michigan Radio)

LANSING, Mich. (AP) — The Michigan Supreme Court is considering a case related to whether the timing of the oath of office should affect the status of Detroit Public Schools emergency manager Roy Roberts.

The court heard oral arguments in the case Thursday.

The case was brought by Robert Davis, an activist who has filed several suits challenging aspects of Michigan's emergency manager law.

DETROIT (AP) - A high-stakes game of political brinksmanship could result in a consent agreement that keeps a state-appointed emergency manager out of Detroit.

But elected officials and municipal unions first would have to agree on concessions aimed at shoring up the city's financially-battered books.

Gov. Rick Snyder says he prefers a consent agreement with the city, which faces cash flow problems and a nearly $200 million budget deficit.

A consent agreement likely would include stiff requirements and still could lead to a manager if Detroit fails to comply. But it could help keep civic pride intact while retaining local control.

Mayor Dave Bing for months has used the threat of an emergency manager to cajole city unions into accepting wage and health benefit reductions. Deals have been reached but remain un-ratified.

A state appointed team that will decide if the Muskegon Heights school district needs an emergency manager really gets to work Wednesday. It’s the first time the team has met in Muskegon.

The governor appointed the review team in January. But because of legal challenges in the Highland Park school district, the team’s work has been delayed until now.

Opponents of Michigan’s emergency manager law, Public Act 4, say they’re concerned about the integrity of petitions they just handed over to the Secretary of State.

If enough petition signatures are certified (approximately 161,000--organizers say they've collected more than 220,000), the law would be suspended until a voter referendum in November.

Because it’s a politically-charged matter of numbers, organizers say they want to make sure those petitions are supervised and handled properly.

 LANSING, Mich. (AP) - State-appointed emergency managers soon could at least temporarily lose the enhanced powers granted to them through a 2011 Michigan law.

Those powers include the ability to strip local leaders of authority and toss out union contracts in an effort to fix an entity's finances.

State election officials could take up to two months reviewing petitions submitted by a coalition that wants to give voters a chance to overturn the law in November. Public Act 4 would be suspended while awaiting the election if officials determine enough valid voter signatures were collected.

Supporters of the emergency manager law say that could lead to confusion in places that have emergency managers such as Benton Harbor, Flint, Pontiac and the Detroit public school system.

Opponents of the emergency law say it undermines democracy.

Mercedes Mejia / Michigan Radio

The cash-strapped Highland Park schools will get help so schools in the district can remain open until the end of the school year, the Michigan Department of Treasury announced today. Michigan Radio's Sarah Cwiek is covering this story and will have an update later.

From a press release sent by Michigan's Treasury Department:

Highland Park Schools Emergency Manager Jack Martin, Detroit Public Schools Emergency Manager Roy Roberts, and State Treasurer Andy Dillon today signed a Memorandum of Agreement (MOA) that provides temporary assistance and support to Highland Park Schools from Detroit Public Schools. The MOA, which will be in place for the remainder of the 2011- 2012 school year, allows current Highland Park students to remain in their current classrooms with their current teachers, if they so choose, despite the district’s financial crisis.

Plans to reform the finances at Highland Park schools hit a snag when a judge ruled the state violated the open meetings act when a state financial review team appointed emergency manager Jack Martin to oversee the school system.

Martin was temporarily taken off his post and re-appointed to his post by Governor Snyder this morning.

In the press release, Martin said their goal is to "ensure that students face as little disruption as possible." He thanked DPS emergency manager Roy Roberts:

“I want to thank Mr. Roberts for his willingness to assist Highland Park Schools through such trying times. I would also like to thank the teachers and staff who have been in class and working all week despite not getting paid last Friday. They will be receiving paychecks later today.”

Detroit Public Schools, which has its own financial troubles, will receive "distressed district student transition grants" worth $4,000 per pupil.

State officials say Detroit Public Schools "will support personnel-related functions on behalf of Highland Park Schools."

A group seeking repeal of Michigan’s emergency manager law has submitted 226,000 petition signatures to place a referendum on the issue in November.

If 161,305 signatures are verified by a state elections panel the emergency manager law will be suspended until the vote comes up in November.

Michigan Radio’s Jennifer White spoke to Ken Sikkema, former Senate Majority Leader and Senior Policy Fellow at Public Sector Consultants, and Susan Demas, political analyst for Michigan Information and Research Service about the implications.

It's looking like the city of Inkster might be able to avoid a state-appointed emergency manager as it works to improve its struggling finances.

A state review team Wednesday voted to accept a consent agreement with the southeastern Michigan city. It should be reflected in a recommendation the review team is expected to soon forward to Governor Rick Snyder regarding the city's financial situation.

A consent agreement would include conditions that city officials must meet, but local officials would remain in charge as long as the conditions are met.

Michigan officials began reviewing Inkster's finances late last year.

Laura Weber / MPRN

Opponents are a step closer to a public vote on Michigan’s law that gives state-appointed emergency managers sweeping authority over local governments faced with a financial crisis. They filed petitions today that would put a referendum on the law on the November ballot.

State elections officials have 60 days to determine if the ballot drive collected enough valid signatures of registered voters. To succeed, they need more than 161 thousand names.

Brandon Jessup is a leader of the drive. He said now the group is gearing up for a fall campaign.

“It’s all voter outreach, definitely. We are going to now begin an education phase to reach out to our broader base and make sure everyone knows about the dangers of this unconstitutional dictator bill,” said Jessup.

Jessup says the law robs local voters of the right to choose their leaders. If the petitions are certified, the law will be suspended until after the election in November.

But state Representative Al Psholka says a stop-gap plan may be needed to ensure stability in takeover communities. 

“If we needed to do something on a temporary basis, I think that would be a good idea not to leave these communities without any protection,” said Psholka. “Because what we’ve found is the taxpayers have not been protected for a number of years. PA 4 didn’t cause all of these deficits and didn’t cause them to be in the condition they’re in.”

Psholka is the sponsor of the emergency manager law.

There are five Michigan cities or school districts currently under the control of emergency managers.

Flickr

DETROIT (AP) - Unions representing about 10,000 Detroit Public Schools employees and the district's state-appointed emergency manager have reached a settlement in a federal lawsuit over pay
cuts and health insurance contributions.

The school district says the settlement was approved Wednesday.

The unions filed the suit last year after Roy Roberts used new powers given emergency managers by state law to impose a 10 percent pay cut and 20 percent contribution to their health insurance.

State Treasury Andy Dillon approved the cuts and also was named in the suit.

Settlement terms include partial payment of accumulated sick days for employees who submit an irrevocable notice of retirement by March 19, a one-time lump sum payment of 2.5 percent of the
employee's 2011/2012 earnings and limited reinstatement of step increases.

LANSING, Mich. (AP) - A coalition seeking to overturn Michigan's law giving more power to state-appointed emergency managers says it's submitting more than 226,000 voter signatures in hopes of
eventually overturning the law.

The Stand Up for Democracy coalition turned in petitions to state election officials Wednesday.

Roughly 161,300 valid voter signatures are needed to temporarily suspend the law and get it on the November ballot. It could take two months for state officials to verify the signatures.

Critics say the law gives unconstitutional power to state-appointed emergency managers, who have authority to toss out union contracts and strip power from locally elected officials.

Supporters of the law say it's needed to provide the tools to fix financial problems that locally elected leaders have been unable to fix themselves.

Opponents of Michigan’s emergency manager law will descend on Lansing with petitions Wednesday.

The coalition fighting Public Act 4 says they’ve collected more than 218,000 signatures to put the measure up for voter referendum in November.

They need the state to certify about 161,000 of those signatures for that to happen—and for the law to be suspended until the vote.

AP File Photo

The state review team looking into Detroit’s finances met in public for the first time Tuesday.

But the meeting was short—less than 20 minutes--and revealed almost nothing about the process behind the review.

The team, led by State Treasurer Andy Dillon, briefly reviewed Detroit’s bleak financial picture--without major changes, the city will run out of cash before the end of the fiscal year. There was also a brief public comment period.

Photo courtesy of Senate Democrats.

At the beginning of the year Governor Snyder appointed an emergency manager, Jack Martin, for Highland Park public schools. Shortly after that Martin was “de-activated” from the position. And now it’s unclear when he might be reinstated.

Democratic Senator Bert Johnson represents Michigan’s 2nd District, which includes Highland Park.

This week people hoping to overturn Michigan's emergency manager law plan to turn in petition signatures to state officials. State appointed emergency managers have broad powers to run cities and school districts with major financial problems. 

Roughly 160,000 valid signatures are needed to put the emergency manager law on the November ballot. The group claims they’ve collected at least 200,000 signatures. If the state certifies them the law would be put on hold until the November election.

The school board in the Muskegon Heights school district requested an emergency manager.

Interim Superintendent Dave Sipka worries what would happen there if the law was suspended.

“If an emergency manager isn’t available to help out then you know there’s a strong possibility this district could go bankrupt," Sipka said. 

Muskegon Heights Public Schools has run a deficit for at least six years in a row.

Michigan Radio

Governor Rick Snyder has signed a law that allows students in Highland Park to transfer to another district or charter school now that the Highland Park district has run out of money. The Legislature approved the measure Thursday.

The Highland Park school district could not meet this week’s payroll, although at least some teachers still showed up for work.

The new law allows several hundred Highland Park students to make a mid-year transfer to another district or a charter school, paid for with a $4,000 state grant.

It’s not known how many students and their families could or would take the opportunity.

Highland Park schools were under the control of a state-appointed manager, but the manager had to step down after a judge ruled the review team that recommended a state takeover violated Michigan’s open meetings law.

It will be next week before the governor can re-appoint the emergency manager.

After that, the new law also allows the emergency manager to use the per-student stipend to pay another district or a charter school operator to hold classes in Highland Park schools.

The Highland Park school board has cleared the way for Governor Snyder to quickly re-appoint an emergency manager.

The board chose not to appeal the state’s finding of a financial emergency in the district.

It was the second time a state review team made that finding. But the emergency manager Governor Snyder had already appointed, Jack Martin, had to step down to comply with a court ruling that voided the appointment process.

Opponents of Michigan’s emergency manager law say they’re ready to tackle the problems underlying the financial distress of many Michigan communities.

Members of the  Financial and Academic Reinvestment Commission (FARC) met in Highland Park Thursday night.

State Senator Bert Johnson, who helped launch FARC last month, says they have a plan to help communities fix fiscal problems without emergency managers.

Johnson says the point is to draw attention to what he calls the “real, human issues” underlying communities in financial crisis.

user alkruse24 / Flickr

Lawmakers at the state Capitol have approved a proposal to make sure students from Highland Park schools are able to attend classes next week.

The school district is on the brink of immediate shutdown after the district’s state-appointed emergency manager was removed.

A circuit court judge ruled the district’s financial review team violated the Open Meetings Act and must begin its work over again.

Ari Adler is the spokesman for state House Speaker Jase Bolger. He said the emergency legislation is necessary to protect students.

“We’re trying to set this up so parents and students will have a choice; they will have some options of where they can continue their education for the school year. Speaker Bolger has drawn a clear line of distinction between the Highland Park district and the Highland Park students. We’re done trying to save the Highland Park school district, we don’t believe it can be saved, but we are trying to save the students,” said Adler.

Adler said a payless payday tomorrow appears to be a foregone conclusion for employees in the destitute district.

Republican leaders say they are not willing to forward more money to the district while the school board remains in control of its finances.

Democratic House Minority Leader Rick Hammel said the Republican plan to provide money for kids to attend other public or charter schools in the area will hurt the students of Highland Park.

Hammel thinks a local intermediate school district should be allowed to take over Highland Park schools until a more permanent solution is found.

"The number one thing is those kids stay in that school – that’s the number one thing for us," said Hammel. "Now, the devil’s in the details. And we have taken an opportunity to just fund Highland Park schools through a responsible source, and created law with lots of stuff that goes in there that doesn’t have anything to do with taking care of Highland Park.”

The Highland Park school board will meet tonight to decide its next move.

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